With the cost-of-living soaring, and in economic times where every penny counts, the Financial Conduct Authority (FCA) has taken a definitive stance to safeguard and maximise UK savers’ interests.
Earlier this year, the FCA rolled out a robust 14-point action plan aimed at ensuring fair value in the cash savings market.
This decisive move was brought about in response to the sluggish pass-through of interest rate rises for savings accounts, despite repeated base rate increases by the Bank of England.
Consumer Duty: A Shield for Savers
The noted disparity prompted the FCA to demand justifications from firms offering the lowest rates, underscoring their commitment to protecting consumers under the newly enforced Consumer Duty.
Sheldon Mills, Executive Director of Consumers and Competition at the FCA, encapsulates the authority’s vision for a competitive market that promptly reflects base rate changes and actively encourages consumers to switch to more lucrative accounts.
The FCA’s action plan is not just a guideline but a mandate for firms to ensure they offer customers what is rightfully due to them.
The plan includes a series of deadlines and reviews, from assessing the timing of savings rate changes to scrutinising the effectiveness of firms’ customer engagement strategies.
These points reflect the FCA’s unwavering commitment to ensuring that firms not only comply with the Consumer Duty, but also actively work towards enhancing consumers’ financial well-being.
This is as much about protecting savings as it is about promoting a culture of informed financial decision-making.
Collaborative Efforts for Consumer Benefit
The plan’s most innovative aspect may be its commitment to collaboration.
By working with services like the Money and Pensions Service and advocating for tools like the proposed savings dashboard, the FCA is fostering an ecosystem where consumer empowerment can be achieved through a collective effort.
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